Benefits Buzz

Better Care Reconciliation Act Version 3.0

Posted on July 18th, 2017

Senate Republicans introduced the Better Care Reconciliation Act of 2017 (BCRA) last month which would repeal and replace key parts of the Affordable Care Act (ACA). It’s been amended two times since it was released and is now in its third version. The latest changes were released on July 13th and include the following updates:
 
  1. Keeps some ACA taxes that primarily apply to higher-income individuals, including the additional Medicare payroll tax and the net investment income tax. 
  2. Makes insurance premiums an eligible expense through a Health Savings Account (HSA).
  3. Allows insurance companies to sell any type of plan, such as a catastrophic-only plan, if they offered at least one plan that covered all the ACA essential health benefits. 
  4. Provides additional funds to fight the opioid epidemic.
  5. Provides additional funds for stabilizing the individual health insurance market. 
The likelihood of the BCRA passing is still uncertain even after these new changes, and Senate Republicans may be forced to pursue different options if they want to revamp the healthcare industry under their terms. These options may include the following:
 
  • Piecemeal Legislation: Instead of trying to repeal and replace the bulk of the ACA with one bill, Republicans could try to pass legislation which changes the ACA one piece at a time. For example, they could pass legislation which only aims to stabilize the individual market and Exchanges for 2018. Similarly, they could pass legislation which just aims to improve and enhance Health Savings Accounts (HSAs).
     
  • Repeal Now, Replace Later: Republicans could dismantle parts of the ACA without any known replacement, and then work to craft replacement legislation after the fact. However, this would be a risky strategy, and this type of bill would likely come with a Congressional Budget Office (CBO) score that significantly increases the number of uninsureds while at the same time increasing premiums. This would be a tough option to sell to the public, but it’s one that has been considered before and one that President Donald Trump recently suggested should be considered again.     
     
  • Work with Democrats: Several Democrats have gone on record to say some parts of the ACA aren’t working as intended and need to be fixed. Republicans could reach over to the other side of the aisle and work with Democrats on a bipartisan bill, but this seems hard to imagine right now. Democrats don’t want to work on any bill that repeals the ACA, and Republicans don’t want to work with Democrats unless they’re willing to consider repeal. 
     
  • Do Nothing: Republicans could put healthcare initiatives on hold and move on to other agenda items they have, such as tax reform. The idea behind this option is a belief that the ACA will continue to fall apart and more Republicans would get behind a unified bill next year if that occurred. This would be a political gamble since 2018 is a midterm election year, and this option could cost Republicans the majority in the House and/or Senate. At the same time, whatever Republicans do or don’t do with healthcare could cost them a majority in either chamber so this option could become a reality.  
Senate Majority Leader Mitch McConnell has postponed the August recess by two weeks so additional time can be used to try and hash out disagreements and pass a bill. Only time will tell what happens next, but the clock is ticking with Congressional efforts needing to shift in the near future towards finalizing an overall federal budget.  
 

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